Following Keir Starmer’s recent appointment as Prime Minister, we would like to provide you with a summary of the Labour Party’s main tax plans, which we are aware of.
With so many claims and counterclaims made by all political parties in the run-up to the General election, it may be difficult to recall exactly what was contained in Labour’s manifesto concerning taxation.
As we know, Labour’s manifesto highlighted targeted tax hikes, aimed squarely at wealthier voters. These tax plans / measures include:
• Closing of non-domicile tax loopholes;
• VAT and business rates applied to public schools; and
• Private Equity bosses will lose their ‘carried interest’ loophole.
Whilst the Labour manifesto states that Income Tax, National Insurance Contributions, Corporation Tax and VAT will remain the same, it is notably silent on the issues of Capital Gains Tax (CGT) and Inheritance Tax (IHT).
There is a great deal of speculation that CGT rates may be increased to be in line with Income Tax. It has also been suggested that the availability of Business Property Relief (BPR) and Agricultural Relief (APR) may be restricted or scrapped altogether which would significantly increase IHT for investors in AIM shares, business owners and farmers. It is also rumoured that similar changes may be made to lifetime gifts for IHT, which currently escape tax if an individual survives the gift by at least seven years.
It is impossible to advise on upcoming changes with absolute certainty until the emergency budget is held, which we think at the earliest will be mid-September, but if you would like to discuss proactive tax planning before then and hear more about what we think might happen with regards to capital taxes then please drop us an email at tax-advisory@robson-laidler.co.uk and one of the team will be in touch.
Alternatively, please call your usual contact in our Tax Team.